Clarity Blog

Clarity Blog

Posts Tagged ‘communications’

How Much Does A Reputation Melt-Down Cost?

Let’s say the principal your company was named after said something some time ago some folks determined was racist.  The media happily jumped on the story, the blogosphere lit up and tweets twittered for days.

What’s that going to cost you?

How about $100 million?

“Oops!”

That’s what Najafi Companies, a private-equity company led by the owner of the Book-of-the-Month Club, Jahm Najafi, is investing in the tarnished brand of Paula Deen, the butter queen. Says the Wall Street Journal:

By its own description, Najafi Cos. often invests in business that are “out of popular favor.” Mr. Najafi said he doesn’t see investing in Ms. Deen to be an extraordinary risk. Despite the controversy, he said, her brand has strong, broad support from core fans across the U.S.

Still, if it takes $100 million to reinstate a brand, we’d say, first,  there’s a fair chunk of risk involved, and second, better to not tarnish the brand in the first place. Have good messages, learn them, and stick to them.

That’s why none of our clients has been deep-fried.

Mesa Water’s Excellent Rebranding Program

By Laer Pearce

Orange County Register reporter Mike Reicher is doing what appears to be a solid job reporting hard and breaking news on the Costa Mesa/Newport Beach beat.  His recent investigative work, however, isn’t as solid and necessitates this post.

Reicher chose to report on a theme nearly all of our public agency clients have to wrestle with: public scrutiny of agency expenses. His focus was Mesa Water District’s communications program, a program we worked on from 2008 through last December, when our current contract ran out. We hope to keep up our good work once the public relations agency review that will be starting soon concludes.

Criticizing a High-Integrity Process

Before we get to Reicher’s criticisms of the cost of Mesa Water’s communications program, let’s look at the district’s process, because good process breeds good programs, and vice versa.  Mesa Water did everything right:

  • We secured our contract by participating in a competitive review in which we faced a number of other capable firms. We were selected because we offered the right mix of expertise, flexibility and cost.
  • Each element of the district’s communications program had to tie back to the district’s strategic plan. If it didn’t help achieve a strategic goal, staff didn’t bother offering it to the board of directors for consideration because they wouldn’t have bothered passing it.
  • After an appropriate period of time, five years in this case, our contract was allowed run out so a new agency review could be conducted. We appreciate this because we realize we are paid with public dollars, and we want those dollars to be spent wisely.

This is a model of good governance and an example for public agencies to follow when selecting a contractor or consultant for a major project, or launching a new initiative. It led to a very successful working relationship and a public outreach effort that received prestigious awards from the California Association of Public Information Officials, the California Special Districts Association and the Orange County chapter of the Public Relations Society of America.

A Justifiable Budget

The article, “Mesa Water’s $500,000 rebranding,” is seriously flawed in its execution, even if the topic is fundamentally legitimate. Newspapers should be skeptical of government expenses and should report on excesses they find. But reporters must be careful not to write a story to support a pre-conceived storyline. If the facts make the story less sensational, they need to write the story that’s there, not the one they wanted to be there.

There is no $500,000 rebranding program underway at Mesa Water, but we will leave it to the district to address most of the story’s inaccuracies, as most are better addressed by them.  We are obligated, however, to correct inaccuracies regarding our billings.

In the story, despite information provided to him to the contrary, Reicher reports we billed Mesa Water “nearly $270,000 in total consulting fees,” which overstates our billings by 18 percent. We billed the district $228,573 for our fees.

Over the five years we worked for the district, our billings averaged out to a bit under $46,000 a year and a bit over $3,800 a month. Mesa Water has been a good account, absolutely.  But you’d have a hard time making the case that they’re the sort that spends crazily on communications – especially if you compare our $3,800 a month to the $110,000 a month the Great Park’s PR firm billed the city of Irvine.

Also, the rebranding included much, much more than simply redesigning a logo. Mesa Water’s Public & Government Affairs Manager, Stacy Taylor, has the right view of branding: It’s not a logo; it’s what your stakeholders think of you. As such, many wouldn’t consider some of our activities for Mesa Water to be “branding,” but they were: They were the necessary laying of a communications foundation upon which a positive brand could be realized.

An Obligation to Communicate

So all of this raises the larger question: How much of their ratepayers’ money should public agencies spend on communications? Many would answer zero, but they would be just as wrong as someone who answered, “The sky’s the limit.”

Here’s what I wrote in an earlier blog post on this sensitive subject:

 Issues are increasingly complex.  People are busier than ever and have less time to absorb information.  The channels of communication are both broader and more cluttered than ever. This is not a safe place for amateurs.  Professional communicators, whether they be in-house or consultants, are increasingly necessary for effective communications.

Mesa Water agrees. The cost of a strategic, two-way, professionally executed program will be greater than the cost of having an administrative assistant put together a newsletter every other month – but it’s worth it because there’s a high price to pay if government entities don’t communicate.

Let’s say for example, a water district with an inadequate communications program proposes a rate increase and is met, as can be expected, with a firestorm of protest. The intensity of the protest leads the district’s board of directors, who all want to be re-elected, to delay the rate increase. This doesn’t do anything to address the higher prices they are paying for water and power, however, and before too long, the district isn’t making enough on water sales to cover its obligations.

Lost revenues and the deferred maintenance that results will cost this water district much more than a good communications program would have.  That’s why we believe public agencies don’t just have a right to communicate with their stakeholders, they have an obligation to.  Agencies have a companion responsibility to communicate appropriately. Again, from the earlier post:

There’s one more thing, one very important thing.  Consultants who work for public agencies need to respect that they are being paid with public money – our money, as taxpayers.  That means we need to be careful to use it wisely, which gets us back to [expensive give-aways and programs that are strategically unsound].  Is that where you want your tax dollars to go?

We didn’t think so.

Laer Pearce & Associates has never pursued the sort of high-cost, low-yield, no-bid public agency contracts doled out by the Great Park, and we never will because they are unjustifiable uses of public funds. Just read my book Crazifornia: How California Is Destroying Itself and Why It Matters to America to get an idea of how I feel about excessive government spending.

Dealing with Journalistic Sensationalism

Should Mesa Water even have bothered working with a reporter who by all signs was intent on writing a negative story?  One water district communicator told us no, and she has a valid point. If you’re being criticized for your communications budget, why pile up more expenses trying to stop the inevitable, especially if newspapers’ reach and influence are diminishing?

Mesa Water’s long-standing philosophy, however, directed them to talk to the reporter as a matter of openness. That’s defensible if you start, as Taylor did, with an understanding that the end result will likely be unsatisfactory. Given that assumption, here are some pointers for dealing with journalistic sensationalism:

First, you have to know before the story comes out how you will respond.

  • Make sure your efforts to secure a fair story are thorough and documented.
  • Provide internal audiences that will be asked about the story with what they need to answer inquiries.
  • Prepare your website in advance with an FAQ on the subject, then update it as necessary when the story is in hand or as comments raise new questions or inaccuracies.

Once the story is out:

  • Respond to customers personally, because newspapers are impersonal.  Taylor is inviting customers to call her, which will give her the opportunity to build a relationship – the end goal of all good communications.
  • Only request the most important and easy to justify corrections because you’ll have a much better chance of securing them than if you try to get a laundry list of corrections through.
  • Prepare yourself for follow-up stories.
  • Finally, be measured in public responses because they will keep the story in the news. Concentrate instead on internal audiences, key stakeholders and customers.  And remember, even the American Society of Newspaper Editors acknowledges that only used car salesmen and advertising executives (not PR executives, thank goodness!) are trusted less than journalists.

Is There Such a Thing as Spam? Not with Obama

Now that the election is over, the super-secret inner workings of the highly successful Obama campaign are becoming known, including the email campaign responsible for most of Obama’s $690 million in online campaign contributions. Public relations and public affairs folks – and anyone who uses email to reach target markets – should take a lesson.

Here’s your textbook: Joshua Green’s The Science Behind those Obama Campaign E-Mails at Bloomberg Businessweek. And here are the lessons:

1. Don’t fly blind

The appeals were the product of rigorous experimentation by a large team of analysts. “We did extensive A-B testing not just on the subject lines and the amount of money we would ask people for,” says Amelia Showalter, director of digital analytics, “but on the messages themselves and even the formatting.” The campaign would test multiple drafts and subject lines—often as many as 18 variations—before picking a winner to blast out to tens of millions of subscribers.

2. Take off your tie

It quickly became clear that a casual tone was usually most effective. “The subject lines that worked best were things you might see in your in-box from other people,” Fallsgraff says. “ ‘Hey’ was probably the best one we had over the duration.” Another blockbuster in June simply read, “I will be outspent.” According to testing data shared with Bloomberg Businessweek, that outperformed 17 other variants and raised more than $2.6 million.

3. Under-think the design

Writers, analysts, and managers routinely bet on which lines would perform best and worst. “We were so bad at predicting what would win that it only reinforced the need to constantly keep testing,” says Showalter. “Every time something really ugly won, it would shock me: giant-size fonts for links, plain-text links vs. pretty ‘Donate’ buttons. Eventually we got to thinking, ‘How could we make things even less attractive?’ That’s how we arrived at the ugly yellow highlighting on the sections we wanted to draw people’s eye to.”

4. Fear not

Fortunately for Obama and all political campaigns that will follow, the tests did yield one major counterintuitive insight: Most people have a nearly limitless capacity for e-mail and won’t unsubscribe no matter how many they’re sent. “At the end, we had 18 or 20 writers going at this stuff for as many hours a day as they could stay awake,” says Fallsgraff. “The data didn’t show any negative consequences to sending more.”

A caveat on that last one. President Obama has a wee tad more draw – both positive and negative – than the subject of most blast emails. You might want to dial back this advice from “nearly limitless capacity for email” to “a much greater capacity for email than you might think.”

 

The Election – Gee-Whizzer Edition

Say “gee-whizzer,” and most old-line journalists and PR folks will know what you’re talking about. It’s a way of presenting facts, particularly numbers, in a way that gets readers’ attention – so much so they say “Gee Whiz!” – and that helps them to retain the information.

Today it would probably be called  “something meme-able” or “something viral-able.” We prefer gee-whizzer.

ENS Resources, a DC lobbying firm, issued a 2012 election results update this morning with so many gee-whizzers we wonder when their staff slept. Here’s the set-up:  At all levels of government, candidates and SuperPACs spent $6 billion on the November election, and for just the presidential race, they spent $2 billion.  How much is $2 billion? Ah, that’s a question that invites gee-whizzers, and according to ENS, it’s enough to buy:

  • Approximately 3.5 million shares of Apple stock
  • 40 private islands
  • Six Airbus A380 jets
  • An Ohio Class submarine (Definitely what we’d buy!)
  • The college debt of 153,846 students graduating from public universities
  • Or, if given to UNICEF, vaccines, pharmaceuticals, medical supplies and equipment, nutritional supplements, mosquito nets, water and sanitation tools and educational supplies for billions of people in impoverished nations.

As for the election itself, it was anything but a gee-whizzer for California businesses. At this writing, with many absentee ballots still to be counted, it appears the Democrats will hold super-majorities in both the Assembly and Senate. That means tax increases can be passed over Republican objections, and businesses are a popular target of California tax increases.

Nationally, Democrats will have trouble finding a mandate, but in California they’ll have no such trouble. They picked up seats and they largely got their way with ballot propositions. That means no signals were sent by the electorate to cut back on anti-business policies and regulations.

For more on California’s sad state, read Crazifornia, by our founder and president, Laer Pearce. Called “the most insightful book on California’s perilous condition – ever,” it provides insights on how California got the way it is, how bad exactly it’s become, and what the prospects are for redirecting the state.

Crazifornia is an Amazon #1 best-seller (21st Century history) and is receiving mostly 5-star (highest rating) reviews on Amazon.

You can purchase a copy on Amazon or read about more about the book at Crazifornia.com.

 

Public Agencies and Public Relations

Should public agencies use public relations firms?

Recent publicity about a PR firm’s plans to promote the San Diego Service Authority for Freeway Emergencies’ yellow call boxes (which aren’t used much anymore) would indicate the answer is no. The newly launched San Diego Watchdog column in the Union Tribune writes of the PR firm’s plan:

The marketing plan features a cookbook with on-the-go recipes. “Drivers are always concerned when traveling to parties about making dishes that will travel well in the car,” says the plan from [the PR firm].

It suggests Tupperware and Igloo ice chests with the call-box agency’s logo and a giveaway of a road trip, hotel stay and theme park visit.

For April Fool’s Day? “Have you pranked someone’s car before and have a photo of it? Show us! Only legal pranks please.”

The $130,000 marketing program is on the agenda Thursday for the San Diego Service Authority for Freeway Emergencies board, which has come under scrutiny in recent months for storing millions of dollars of reserves even as the number of calls into the system plummets.

Update:  Just after we posted this item, the PR agency, which had been working for the San Diego Service Authority for Freeway Emergencies since 2007, was canned.  Here’s the news item.

We confess at the outset we have little empathy for PR plans that require expensive give-aways like logo-adorned ice chests.  If you’re popping $20 or more for each decent ice chest you want to give away for free, how do you hope to get a positive return on investment?  Conversely, if you’re only proposing to spend $5 each for a cheap Styrofoam cooler that will fall apart the first time it’s used, how do you expect to communicate quality for your client’s brand?

But that’s not what bothers us the most about this proposal. It’s this: The client is dealing with criticism for charging too high a fee for a service that’s of too little use, and for holding too much in reserves.  How does this public relations proposal address the issues the client faces?  Simple: It throws gasoline on the flame with an expensive, out of touch program.

Consumer public relations firms, which often are overly driven by the need to be creative, are more likely to make a mistake like this than a public affairs firm like ours, because we are more attuned to public perception and more aware of downside risks.

Doing it Right

Please don’t get us wrong, though.  We believe public agencies are justified in using professional communicators.  In fact, because agencies typically deal with important civic functions (yellow call boxes notwithstanding) we think they frequently have an obligation to.

Issues are increasingly complex.  People are busier than ever and have less time to absorb information.  The channels of communication are both broader and more cluttered than ever.  This is not a safe place for amateurs.  Professional communicators, whether they be in-house or consultants, are increasingly necessary for effective communications.

More importantly, agencies need to listen.  As a strategic communications firm to several public agencies, we place the importance of incorporating “feedback mechanisms” into outgoing communications right below the need to make outreach programs goal-focused and measurable.  When incoming communications are a part of a campaign, they yield information that can be shared with the agency’s leadership, so they better understand the public’s perceptions, concerns and expectations.

A good communications consultant also will work hard to promote and ensure transparency.  A few years ago, we argued for our public agency clients to post board agendas and minutes, staff reports and budgets online for public viewing.  The practice is now the norm, and staff and board compensation information now also is available.

There’s one more thing, one very important thing.  Consultants who work for public agencies need to respect that they are being paid with public money – our money, as taxpayers.  That means we need to be careful to use it wisely, which gets us back to coolers with logos.  Is that where you want your tax dollars to go?

We didn’t think so.

Communications Lessons from Kim Jong Il

Our sympathies go to the North Koreans we’ve seen on YouTube bawling inconsolably at the passing of Kim Jong Il, their “Dear Leader.”  We truly hope some day they will have a chance to understand how duped they were by the man who drank $700,000 worth of cognac a year while they slaved and starved.

That said, we found out we do owe a debt to ol’ K Jong – he bequeathed the world with ten management secrets, detailed very humorously by Constantine Von Hoffman in Inc.  We were particularly amused by the dictator’s second secret:

Communication is overrated. He only made one broadcast to his nation. In 1992, during a military parade in Pyongyang, he said into a microphone at the grandstand: “Glory to the heroic soldiers of the Korean People’s Army!” Even so, North Koreans wept on the streets like Elvis fans when they heard of his death.

As with all things K Jong, this management principle is just a tad extreme.  We recommend it only for leaders who own all the media outlets in their entire country and have legions of creative publicists inundating the entire populace with propaganda, like the claim he played a 36-under-par round the first and only time he played golf.

Most of us face a different reality, so it’s not likely our communications will have quite the effect Dear Leader’s had.  But still, there is something to be said about holding back the chief, so when he speaks he’s listened to.

We learned the power of this approach while ushering a very controversial project in Moreno Valley through seven Planning Commission and six City Council hearings .  The project manager, Steve Eimer, sat throughout nearly all of the 13 hearings without saying a word, always deferring to his consultants – until the last minutes of the last hearing.

Just before voting, the City Council added a new very expensive and utterly unreasonable condition to the project.   Eimer stood up, walked up the podium, waited to be recognized, and quietly said, “If you require that, we will not build the project.”

He returned to his seat without saying another word, and the City Council members started thinking about their re-election prospects if all the jobs and money the project would bring the city disappeared.  Then they quickly withdrew the provision and voted to approve the project.

So, yes, a few carefully chosen words delivered at just the right time can be very powerful communication tools.  K Jong got one thing right. But only one thing.

Are Water Agencies About to Drown in Positive Polling?

A recent survey conducted by the Municipal Water District of Orange County found that 93 percent of the 500 respondents feel Orange County’s water supply is somewhat reliable or very reliable.  That’s big news to us in the business of influencing public behavior, because a similar question asked in the agency’s 2008 survey found that only 27 percent felt OC had a reliable supply.

So can us communicators take credit for the nearly four-fold jump in public perception?  After all, our water supply is just as reliable today (or unreliable depending how you look at it) than it was three years ago.  We humbly say, “not so fast.”

(more…)

Millennial Tweet

Laer Pearce & Associates’ Twitter feed on water-related items, @LPAWater, just got its 1,000th follower.  (Actually, it now has 1,001 followers, but that would make headline writing more complicated.)

We’ve learned some lessons along the way.

  • Tweeting can be good for business.  We have one new water client from our tweeting – without those tweets, we would never have met each other.  And we’ve helped a number of water districts develop their social media strategies.
  • Tweeting can be good for your brand.  A state senator recently told me he loves @LPAWater’s tweets, and at this week’s ACWA conference, many folks complimented me on @LPAWater.  Our followers include many clients, potential clients and water industry opinion leaders.  What does that mean?  It means people recognize that Laer Pearce & Associates stays on top of water issues and has a fun time doing it – which is exactly what we want our brand to communicate.
  • It’s not easy being “Tweet.”  Our @LPALand and @LPAGov Twitter feeds never found an in-house champion (ahem!) like @LPAWater did , so they’ve languished, with 200 and 156 followers respectively.

@LPALand will eventually find its pace, I’m convinced, but in retrospect, we probably launched @LPAGov before we should have.  Yes, we follow government stuff as closely as we do water, and yes we want to expand our brand recognition in that portion of our practice.  But there are so many questions about our ideal position in that segment that it’s never been clear enough what should be tweeted at @LPAGov.

On the plus side, at no cost, Twitter showed us an area where we have some branding work to do.  That’s one of the wonderful things about social media – you can experiment, adjust and improve without have to throw away 1,000 brochures that no longer mesh with your identity.

As one of Orange County’s leading public affairs communications firms, our own experience with Twitter, Facebook, YouTube and other social media has helped us to realize the good, the bad and the under-realized power of the phenomenon, and that’s made us much better at designing social media strategies for our clients.

A Missed Message

The folks behind the Sacramento Delta water conveyance tunnel have a new message out that has a familiar ring:  Jobs. Heard that much lately?

Drilling large tunnels to divert water around the Delta would create more than 129,000 jobs, almost all of them during the seven-year construction period, according to a recent analysis.

The report by a University of California, Berkeley, economist does not examine how the peripheral canal or tunnel plan might create or destroy jobs in other ways, such as the proposed conversion of tens of thousands of acres of Delta farmland to wetland habitat. (Read more here)

We’ve used that UC Berkeley economist, David Sunding, ourselves and we know his work is solid and these are numbers that will stand up, come testing time.

But there was a powerful and timely message missed here, and that’s too bad.  We’ve all heard stats recently about the cost per job of jobs created by the federal stimulus – from the hundreds of thousands of dollars each to over $1 million for every shovel-ready (or crony-ready) job generated.  A little quick math here – the $12 billion estimated cost of the tunnels divided by 129,000 jobs … wow, that’s just $93,023 per job, which is pretty darn cheap when you consider the number of attorneys that will be working on the project.

Lesson:  When talking about jobs generation, whether it’s about tunnels or anything else, dig a little deeper. Put the numbers in a context that’s current and more people will remember more of what you said.

Blacked-Out Blues

Last Thursday, some poor sap in Yuma flipped a switch and the power went out for millions of Southern Californians. Water systems, which of course are heavily reliant on power, got through the crisis in pretty good shape thanks to lots of emergency drills  – although several water districts had to issue notices to their customers warning them to boil their water before drinking it. That, too, passed.

All this made us think: How do you alert people to a crisis when their TVs, radios and computers are down? On our water Twitter feed, @LPAWater, we tweeted the following answer:

Tweet #1:  How do you notify people of a boil water notice when power’s out so no TV, radio or internet? Answer: Reverse 911, tweets, blast emails,

Tweet #2:  … posted notices, sound trucks, Facebook, police/fire liaison + the usual. Crisis calls for creative solutions.

For more on Laer Pearce & Associates creative solutions to crisis situations, check this out.